Transition Ventures Shifts Focus to AI Infrastructure
Transition Ventures, the London-based early-stage investment firm co-founded by David Helgason, has successfully closed a new fund, raising $150 million. This significant capital influx marks an important transition for the firm, as it pivots from its initial focus on climate-related investments to backing startups in the burgeoning field of AI infrastructure.
From Climate Tech to Physical AI
The firm’s new strategy emphasizes what Helgason refers to as ‘physical AI’. This approach aims to support startups that are leveraging artificial intelligence to rebuild and enhance real-world infrastructure, spanning sectors such as semiconductors, nuclear power, and even wildfire suppression. The global market for physical AI was valued at approximately $81.6 billion in 2025 and is projected to reach an astounding $960 billion by 2033, reflecting a compound annual growth rate (CAGR) of 36.1%, according to a report by Grand View Research.
Lessons from the Past
This strategic shift comes on the heels of a challenging experience for Transition Ventures, notably the collapse of Running Tide, an ocean-based carbon removal company in which the firm had invested. Despite initial promise, Running Tide failed to generate sufficient demand in the voluntary carbon market, leading to its downfall in June 2024. Helgason described this setback as a deeply difficult experience but has since redirected the firm’s focus and raised substantial new funds.
A Bright Future for AI Infrastructure
In light of the significant market potential for AI solutions, Transition Ventures aims to capitalize on the growing demand for advanced technologies that can positively impact various industries. The firm’s renewed vision is set to contribute to a future where artificial intelligence plays a critical role in enhancing and transforming infrastructure around the globe.